Conflict between the VC and entrepreneur: The entrepreneur's perspective

Abstract

In this study, the effects of conflict on confidence in partner cooperation are explored. While the literature on VC-entrepreneur interactions is well developed, viewing the impact of conflict within the dyad is less developed. The data are based on a survey of 57 entrepreneurs who have received venture capital investments. Whereas past research finds that VCs view task conflict favorably, the current study finds that entrepreneurs do not, which leads to reduced confidence in partner cooperation. Furthermore, intragroup conflict within the entrepreneurial team increases conflict between the entrepreneurial team and VC. The implications of the findings suggest that it is important for the entrepreneurial team to build cohesion both within the team and with the VC so that if conflict arises, it doesn't lead to lower overall performance. © 2010 Taylor & Francis.